Tourism, Institutions, and Poverty Alleviation: Empirical Evidence from China. (September 2021)

• Record Type: Journal Article
• Authors: Zhao, Lei
• Is Part Of: Journal of travel research. Volume 60:Number 7(2021)
• Page Start: 1543
• Page End: 1565
• Publication Date: 2021-09
• Subjects: tourism development -- institutional quality -- Foster–Greer–Thorbecke (FGT) measures -- poverty alleviation -- China; Travel -- Research -- Periodicals; Tourism -- Periodicals; Tourism -- Research -- Periodicals; 910.72
• DOI: 10.1177/0047287520947792
• Languages: English
• ISSNs: 0047-2875

Abstract

While tourism can be advocated as a means for poverty reduction, the inconclusive issue of poverty in developing countries has harbored doubts about the efficacy of tourism development in its reduction. This study empirically examines whether institutions influence how tourism development affects poverty. We apply the system generalized method of moments technique to estimate our empirical model. By using panel data for 29 Chinese provinces over the period 1999 to 2014, we empirically reveal that tourism and institutions have significant and negative effects not only on the absolute poverty but also on the relative poverty as measured by the Foster–Greer–Thorbecke (FGT) poverty indices in both the short and long run albeit at varying magnitudes of effect and levels of significance. In addition, institutional quality positively moderates the tourism–poverty nexus, thereby suggesting that the pro-poor effect of tourism development decreases as the quality of institutions improves in the thin institutional setting of rural China.